Market News

Hog futures up on China optimism

Chicago Mercantile Exchange live cattle futures were steady to modestly higher in light pre-holiday trade ahead of the week’s widespread direct business. December was up $.25 at $122.65 and February was $.15 higher at $125.82.

Feeder cattle were mixed, mostly firm on the same factor as the live pit. January was up $.05 at $143.57 and March was down $.05 at $143.67.

Direct cash cattle business was at a standstill. Asking prices were $123 live and $195 dressed, with a few bids at $121. How much business needs to be done this week is a big question. Several buyers in recent weeks bought cattle for delayed delivery this week, so many will either be purchasing for immediate needs or for delayed delivery at some point in early January. DTN says there are 56,000 head of cattle in Texas alone committed for delivery this week. It also remains to be seen exactly when business will develop. Some might want to get activity wrapped up today and take a very long weekend, while others might try to find bargains after Christmas. The USDA says beef in cold storage on December 1st was down 7% on the year.

The five-day average for Choice boxed beef was $211.63 with the average for Select at $202.51.

Last week in Nebraska, feeder steers weighing less than 700 pounds were steady to $3 higher, while steers weighing more than 700 pounds were $2 to $4 higher. Feeder heifers weighing less than 700 pounds were mostly $4 higher and heifers weighing more than 700 pounds were unevenly steady. The USDA says demand was good for the last full week of sales, with limited trade expected until the first full week of January 2020. Medium and Large 1 feeder steers weighing 500 to 600 pounds were reported at $150.50 to $192.75 and 600 to 700-pound steers brought $140 to $172.50. Medium and Large 1 feeder heifers weighing 500 to 600 pounds ranged from $134 to $168.50 and 600 to 700-pound feeders sold at $133 to $153.50.

Lean hog futures were up modestly in light trade on optimism about China and short covering. The USDA’s weekly export sales report will be closely watched since it covers the first full week after the tacit agreement on phase one of the trade agreement. February was $.45 higher at $70.70 and April was up $.45 at $78.

Cash hog business was expected to be steady to firm. Many buyers already had the needed numbers in hand after good negotiated runs to start the week, but some were still expected to raise bids to move supplies during this holiday slowdown. The USDA was closed Tuesday, so many market sensitive reports were not released, including direct hogs, wholesale meats, and the estimated daily livestock slaughter. Private estimates for Tuesday’s kill were around 150,000 head and the early projections for Saturday were around 415,000 head. The Quarterly Hogs and Pigs numbers were bearish, but very close to expectations. Pork in cold storage was an all-time high for December 1st. China’s Ministry of Customs says the world’s biggest pork consumer bought 229,707 tons of pork in November, up 150% on the year, with year to date purchases at 1.733 million tons.

The five-day average for the pork carcass cutout value is $77.24. Butts, ribs, and bellies were above that mark, while loins, picnics, and hams were below.

The five-day rolling average for national direct barrows and gilts was $48.02, with Iowa/Southern Minnesota at $47.59 and the Western Corn Belt at $47.58.

In the most recent hay auction in Rock Valley, Iowa, compared to the previous test, alfalfa and grass were steady to slightly lower, straw was down, and corn stalks were steady. The USDA says quality was average. Premium large rounds of alfalfa sold at $195 per ton, with good to premium at $162 to $160 and good quality at $120 to $160. Good quality large rounds of alfalfa and grass mix brought $117.50 to $145, while good large rounds of grass were pegged at $122.50 to $155 and fair large rounds of grass sold at $97.50 to $120. Corn straw rounds were reported at $62.50 to $72.50, while large squares of wheat straw brought $132.50 and rounds ranged from $110 to $115.